Of the Week…

We learned during the week that in 2011, for the first time, sales of adult diapers in Japan exceeded sales of baby diapers. This was presented in the context of Japan’s aging population where 23.3% of the population are aged 65 or over, compared with less than 12% in Ireland.

Mind you, with the announcement of Budget 2013 only days away, when an additional €3.5bn will be taken out of the economy in 2013, maybe we could all do with an adult diaper.

Social Climber of the Week

“That is how we will get out of the economic crisis, not by running around like a blue-behind fly waving slogans. “ An Tanaiste Eamon Gilmoreresponding to a question in the Dail from fellow-constituency representative, People Before Profit deputy, Richard Boyd Barrett

Actually, I believe the precise words used were ““running around like a blue [pause] behind bluebottle waving slogans”. Unfortunately the transcript of Dail proceedings won’t impart the hilarity of the moment when An Tanaiste Eamon Gilmore rebuked Deputy Boyd Barrett and his criticism of the new property tax. There was the tiniest of pauses just after the first “blue” as Tanaiste Gilmore yah-booed his fellow Dun Laoighaire TD.

Time was, when a Labour Party TD would just simply say “blue arsed fly” and have done with it.

Pose of the Week

Isn’t it about time the folded arm pose was given the elbow. In last weekend’s Sunday Business Post magazine – not available online – practically everyone, man/woman, writer/subject, was photographed with the very impressive, no-nonsense, commanding respect pose. But when everyone poses for their photographs in this way, it all looks a little silly, unoriginal and wannabeish – even Wayne Rooney has ditched the pose from his Twitter account. The pose also looks hostile and unfriendly – maybe time to adopt something more pleasant, the red carpet pose perhaps or something like Jedward.

Apparently the National Treasury Management Agency (NTMA) has its own salary-setting freedom because it needs attract the best in the marketplace and remunerate appointees accordingly. So it came as a bit of a shock when it was the Comptroller and Auditor General who first reported the €3.2m “error” when the NTMA disposed of shares using the services of global financial services company, State Street. The NTMA then went on to claim “To be clear, what had happened was fraudulent in nature and totally unacceptable.” Obviously the NTMA isn’t paying peanuts for monkeys with its CEO on an annual package of €480,000 plus 60% potential bonus, though there have been waivers in 2012. So many are asking how the non-monkeys at the NTMA failed to spot that one of its agents had deducted €3m-odd from the sale of shares on its behalf. “It was never visible” says Minister Noonan replying to Labour’s Deputy John Lyons this week. Or did the non-monkeys just have their hands over their eyes.

Table of the Week

Just past the witching hour last night, the Department of Finance published its so-called “White Paper” which sets out its estimates of the nation’s financial performance in 2012 and 2013 BEFORE taking into account the effects of next week’s Budget 2013 announcements on Wednesday 5th December. It is interesting to note that the expected GDP in 2012 is €163.659m –that is, the deficit of €13.42bn being 8.2% of GDP, grossed back up – and this is 2.93% greater than the nominal GDP in 2011 of €158.993bn. The Government recently revised its 2012 real GDP estimates up and the estimate now stands at 0.9% growth but annual inflation, as measured by CPI, is running at 1.2% at the end of October 2012 after energy price rises that kicked in, in October 2012. With a consensus forecast of 2012 GDP of around 0.5%, this nominal GDP looks ambitious.

Birthday of the Week

By a vote of 138 to 9 with 41* abstentions, Palestine was born in the UN this week as a non-UN member with observer status. The nine gainsayers were Israel, Canada, Czech Republic, Panama, Palau (Pacific Island nation, population 20,000), Nauru (Pacific Island nation, population 9,000 same as Tramore) Marshall Islands (Pacific Island nation, population 55,000) Micronesia (excluding Marshall Islands and Nauru, population about 30,000) and the US. The abstainers included the UK, Germany, Australia, Poland and Holland.

So what will the new status mean for Palestine? Apparently, they can now sue Israel for crimes against humanity. Though presumably, that’s a reciprocal right and Israel has its own grievances against Palestine. They already had the Palestinian domain extension “.ps” and international dialing code of +970 contrasting with +972 for Israel. We already have a Palestinian ambassador to Ireland.

As a country in its own right, I guess we might see a Palestinian entry in next year’s Eurovision song contest where they’ll likely get as rapturous a welcome as the painfully-formed former-Yugoslavian countries in the 1990s. Some black humourist on Twitter yesterday suggested they might enter a version of “Yassar I can boogie”

Who knows, maybe Palestine will become an offshore financial services magnet. It might even get some business from Israel. The mind boggles!

The two-state formula where there is mutual recognition and acceptance was always going to be the long-term solution to the Gordian Knot of history, Biblical and modern-day, and peoples, Jew and Arab. This week’s birth doesn’t solve that problem, but it does now mean there are two countries around which normal societies can eventually coalesce in the long term. Happy Birthday Palestine!

Judging by the reporting of leaks this week in the run-up to the Budget 2013 announcements next Wednesday, it seems that the property tax will be the centerpiece of the budget. Which is odd really because of the €3.5bn total adjustment in 2013, the property tax is rumoured to only generate €500m.

But here’s the thing.

If the introduction of the property tax will see the abolishment of the second home tax, then the new property tax will need raise an extra €70m per annum to replace the lost taxation – so it will need raise €570m, not €500m. And the administration of the new property tax is going to be expensive, far more expensive than the €10m cost of the flat €100 household tax in 2012. And it seems there will be far more waivers and exemptions for low income, ghost estate residents, local authority tenants, recipients of social welfare including mortgage interest payment, negative equity and recent purchases where stamp duty still lingers in the buyers’ memory.

If there are 2m dwellings in the State with over 200,000 in negative equity, 150,000 renting from the State, 20,000 receiving mortgage interest assistance, 30,000 in ghost estates, it is hard to see how the average bill for an eligible property won’t be less than €500 per year, and there won’t be any discount in 2013 – not if the Government wants to raise €500m.

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3 Responses

Shout out for the hard working officials at the Dept. of Foreign Affairs,way to go guys…I’m sure young Conor McRedmond, 28, from Tullamore, Co Offaly,sleeps easier tonight knowing you guys are on the case!

Conor worked in NY,by all accounts a legend.One the reasons the “dispora” is not overly enamoured by the “taking” is the lack of any voice by the Dept of Foreign Affairs,when situations like this arise.
Do you think a “yank” would serve time for this….http://www.dfa.ie/home/index.aspx

As I got it slapped into me on Seamus Coffey’s blog, real GDP is not calculated simply by reference to inflation. The exact mechanism is unclear to me and inflation must play a part, but it is not fair to say that 2012 growth can be directly inferred with reference to a base of 2011 nominal GDP and inflation in 2012.

That Japanese Diaper story comes from Zerohedge, which gets its story from Businessweek, which gets its story from Bloomberg. From my reading of the relevant sentence in Bloomberg, the diaper thing applied to one Japanese company only – i.e. one company’s sale of adult diapers now exceeded its sale of baby diapers:
“Unicharm Corp. (8113)’s sales of adult diapers in Japan exceeded those for babies for the first time last year”.